EU Says McDonald's Tax Deals With Luxembourg Legal

The European Union on Wednesday ended a long-running investigation into the tax arrangements between US fast food giant McDonald's and Luxembourg, finding the setup did not amount to illegal state aid.

Brussels, (UrduPoint / Pakistan Point News - 19th Sep, 2018 ) :The European Union on Wednesday ended a long-running investigation into the tax arrangements between US fast food giant McDonald's and Luxembourg, finding the setup did not amount to illegal state aid.

"Luxembourg did not break EU state aid rules," EU Competition Commissioner Margrethe Vestager told a news briefing in Brussels.

With the decision, the maker of Big Mac and McNuggets escapes the fate of US giants Apple, Starbucks and Amazon, which were ordered by the EU to repay years of back taxes.

The case stemmed from a complaint by trade unions and the charity War on Want accusing McDonald's of avoiding around one billion Euros ($1 billion) in taxes between 2009 and 2013 by shifting profits from one corporate division to another.

"Of course, the fact remains that McDonald's did not pay any taxes in Luxembourg on these profits -- and this is not how it should be from a tax fairness point of view," Vestager said.

But the commissioner said she welcomed that Luxembourg was in the process of closing tax loopholes related the EU's investigations.

These would "avoid such situations in the future," she said.